“One in 10 shops now empty as number reaches four-year high”

“The number of empty shops in town centres has reached its highest level since 2015, figures have shown.

The national vacancy rate was 10.3% in July, the highest since January 2015, according to the BRC (British Retail Consortium)-Springboard footfall and vacancies monitor.

Footfall also fell by 1.9% last month, marking the worst decline for July since 2012.

Helen Dickinson, chief executive of the BRC, said retailers had faced a “challenging environment”.

“High streets and town centres play an important part in our local communities, and we should be concerned by the rise in empty store fronts,” she said.

The figures showed that high street footfall declined by 2.7% last month, while footfall at shopping centres fell by 3.1%. …”

https://www.devonlive.com/news/uk-world-news/one-10-shops-now-empty-3199745

Midweek Herald asks: where IS Cranbrook town centre?

Good question!

https://www.midweekherald.co.uk/news/cranbrook-town-centre-investigation-part-one-1-6175614

Made all the more relevant by Exeter City Council refusing ALL THREE applications for out-of-town developments aroundHoniton Road last night,citing, in part, the need not to stand in the way of the development of a town centre in Cranbrook.

High Street trading German-style

James Timpson, chief executive of Timpson Group:

“I have just got back from Germany, where I’ve been looking for ideas to bring back to Timpson shops in this country. Germany is a good source of inspiration because the weather there is similar to ours — it rains a lot. And rain is good for cobblers. The more it rains, the more shoes wear out. If we were to open in Dubai, I doubt we would do well.

The German retail scene is different from what I see when I travel around Britain, visiting more than 1,000 of our shops each year. There were hardly any vacant sites over there, no closing-down sales — and the high streets and shopping centres were busy. I’m sure the landlords are also doing well.

The Germans are just behind us in the amount they buy online, and they have many of the same brands as our high streets. The problem in Britain is that we have way too many shops — far more than in Germany.

My company rents 95% of its shops from landlords whose aim is to get us to pay the highest rent possible. My fantastic property team battle to find evidence to prove that rents should be lower. We were on the losing side of this cat-and-mouse game for years after I joined the business in 1995. In the past four years, however, the tide has turned.

In the 40 lease renewals we have completed in the past three months, the rents have come down by an average 9.6% — and that doesn’t take into account the generous rent-free periods we’ve also pocketed. There are some shops where the rents have come down by 80%, and more than a dozen where we pay no rent at all.

You will find many retailers complaining about high rents, but you will find even more complaining about high business rates.

When I became chief executive, in 2002, I started a discipline I still abide by today, and still hate doing just as much. I go through the profit-and-loss accounts for every one of our 2,100 shops every month, looking for errors and bad performance. While I’m no accountant, it’s amazing what you can learn.

The biggest change over this time has been how much the rates bill — the amount we pay local authorities as a property tax — has gone up (business rates brought in £25bn for the government in England last year).

The rule of thumb used to be that rates made up 30% of the rent. The figure is now 44% and growing. You can see why many retailers find this difficult to afford and difficult to understand. With online shopping growing, more out-of-town retail parks popping up and consumer sentiment weak, retailers are closing shops at an alarming rate.

However, I don’t think rates are the real problem — it’s rents.

Rates are based on the value of the property. If that goes up, the rates go up. It can take some time for the figure to reflect the true value of the building — and years to be adjusted to a fair level. The lag is the problem.

The Louis Vuitton shop on London’s Bond Street saw its annual rates bill soar from £3.9m to £8.5m a couple of years ago — up 118%. The nearby Chanel shop suffered a 135% increase. The rents rose so steeply because the value of the buildings they trade from had also gone up dramatically. These prized assets come with big bills.

Because of the lag in assessing what each property is worth, many in my chain have been overpaying rates for some years. In essence, Timpson shops in less glamorous locations have been subsidising global designer brands such as Chanel. While we never look for pity, we do like to play a fair game.

Now, on to rents. As they come down, we are seeing a drop in the rates we pay. Landlords are becoming more astute in recognising that it’s often better to take a reduced rent than to receive no rent at all and be forced to pick up an “empty rates” bill on top. This process takes years to unwind — up to 10. Most leases we sign run for 10 years, with a break clause at five. Only at these two points can we challenge the landlord to get the rent down. We still don’t win them all — the rent in Nantwich went up last week!

So retailers shouldn’t worry about the rates, which they can’t control, and concentrate instead on battling with landlords to get the lowest possible rent. This will, in time, lead to lower rates.

I’m proud of the amount we pay in rates (£8.6m last year, against a rent bill of £19.3m). This money pays for our customers to drive on roads to get to the shops, for our sick colleagues to go to hospital, and for schools to educate our children.

While we may not like paying too much, our rates go a long way to help the communities who shop with us. Other retailers should think the same way.”

Source:Sunday Times (pay wall)

Small businesses accuse government of failing them

“Theresa May’s Government today stands accused of failing to back small businesses, in a report due to be launched by Home Secretary Sajid Javid.

A damning poll reveals three in five people think the Tories are letting down the army of small firms which are vital to the economy and town centres.

The findings come from a YouGov survey of 1,644 adults for the Centre for Policy Studies think tank, which was founded by Margaret Thatcher.

It revealed 60% of people believed the Government “is not on the side of small business”, with just 14% disagreeing. …

This report shows how bureaucracy and paperwork are stifling the growth of our small businesses and offers a series of compelling ideas for how Government can roll back the tide and show that the Conservatives are backing entrepreneurs.”

https://www.mirror.co.uk/news/politics/small-businesses-damning-verdict-nine-16052199

Be sceptical about pre-election rumours!

Ask yourself – who would start such “good news” rumours just before local elections!

“A pair of retail giants has quashed rumours of setting up shop in Sidmouth.

Both Marks and Spencers and Superdrug have ruled out any plans to set up a food hall or beauty store at this time.

With a number of buildings available for new businesses in the town, there has been talk that both companies may have had their eyes on coming to Sidmouth. …”

https://www.sidmouthherald.co.uk/news/m-s-and-superdrug-not-coming-to-sidmouth-1-6024390

Cranbrook urgently needs temporary GP practice

Owl is amused at the idea that an extra GP practice would increase footfall in the “town”. But you just cannot call a settlement of 2,000 houses with 5 shops a town – maybe “suburb of Exeter” is now more appropriate!

“… Cranbrook temporary GP Practise
The Projects Director presented the report which sought approval for up to £150k of funding from the Enterprise Programme to enable the delivery of a temporary GP practice in Cranbrook town centre. This was an urgent requirement because of the lack of capacity at the current practice. Whilst Access Healthcare had had their contract extended there were significant concerns over the ability to deliver increasing patient numbers. Expanded facilities were therefore urgently required.
Discussions included the following:

 if not supported this would create a massive health inequality
 this was a loan therefore the borrowing would be repaid
 as well as helping the health service, this was a benefit to the residents of Cranbrook as the existing provision was under pressure. …

The current GP practice in the Younghayes Centre was at capacity. The temporary GP practice would enable the continued delivery of primary care services in Cranbrook for a period of 5 years. It would also bring increased footfall to the town centre and act as a catalyst for attracting wider investment.”

https://democracy.eastdevon.gov.uk//documents/g143/Printed%20minutes%2003rd-Apr-2019%2017.30%20Cabinet.pdf?T=1